Manulife Financial has been an underperformer since the start of the tariff war, notes National Bank. Not only is the lifeco underperforming its peers and the Big-6 banks, it is also underperforming Asia-focused insurers. Analyst Gabriel Dechaine believes the latter group is relevant for comparison, given the growing impact of U.S.-China trade tensions on local stocks (e.g., Hang Seng down ~8% since April 2) and on economic outlooks in the region.

"We attribute MFC's recent underperformance to two possible factors: 1) investors viewing it as a more "beta sensitive" name, rather than a defensive one; and 2) concerns related to its Asia segment." Dechaine points out that Manulife's Asia segment is critical to the lifeco's 18%+ by 2027 ROE target, contributing nearly 50% of planned ROE expansion. Dechaine believes he market is discounting that the Asia segment may not contribute to MFC's ROE expansion as much as expected (or at all) due to U.S.-China trade tensions and calculates a 5% downside risk.

Reiterate Outperform, with a $50 target.